Sunday, November 28, 2010

KLOVE's Mike Novak: Compensation Tops $500,000

About a month ago the omnipresent Christian radio station KLOVE wrapped up its fundraising drive. You probably heard it, too. Pleas went out for more funding and you had kids giving their allowances, businesses committing, single moms pledging, families pledging, the works. God bless 'em if that's how the Lord is leading them to spend their money. The radio in my Volvo doesn't work anymore, one of the effects I suspect of a vehicle with 323,000+ miles on it, so I don't listen to KLOVE as much as I have in the past. I do spend more time in the Volvo praying, which is a good thing. KLOVE is about our only option out here in Gloucester, Va., as far as Christian radio, so we listen to it in the van. I'm really not sure where I stand on KLOVE ... I appreciate the effort to bring Christian music to the masses on a platform that literally stretches across the country. But I hear the same songs over and over again and many times I'm looking for something fresher and seem to hear songs I heard 10 years ago again and again. As I said to Ethan a week or so ago while we were riding in the van, "Is no one making any decent Christian music anymore?" That being said, I decided to take a peek at KLOVE's books as I did about a year and a half ago on this blog. Let's just say being one of the bigwigs at KLOVE pays off handsomely.

As I mentioned, KLOVE stretches across the country and has radio stations and transmitters all over the place, so it's a big business from that standpoint with lots of employees. The parent organization of KLOVE, Educational Media Foundation, reported revenues last year of $88.2 million, according to forms filed with the IRS. Total payroll, including benefits and taxes, topped $25 million and net revenue was $16.7 million, according to the forms filed with the IRS.

I'm sure you've all heard the voice of KLOVE President Mike Novak, especially at pledge time, and last year (2009) his total compensation was $506,198, according to documents filed with the IRS. Think about that for a minute ... wow, that's a ton of money. It takes 12,655 people pledging $40 a month just to cover his compensation. Is he operating Christian radio stations or working on Wall Street? He received $343,792 in base compensation (that's $28,649 per month) and "bonus & incentive" compensation of $110,000 (A lot of us got bonuses on par with that last year, right?), other reportable compensation of $9,628, retirement & deferred compensation of $22,549 and "nontaxable benefits" of $20,229. The big question to me is what is acceptable for a guy of Novak's position and stature? Is $506,198 acceptable, considering there's no disclaimer come pledge time that 12,655 of you monthly pledgers are just paying for Mike? As the guy who runs what essentially is a national organization, is he deserving of that paycheck?

Here's a couple of head-scratchers from the IRS forms. Dick Jenkins, the former president who is no longer with KLOVE, received $300,000 in "other reportable" compensation and another $13,196 in nontaxable benefits. That's only 7,830 $40-per-month pledgers to pay for a guy no listed as the "former president." Speaking of guys no longer with the organization ... former radio personality and programming director Jon Rivers left KLOVE in early 2009 and earned $261,543 in "other reportable" compensation and $3,659 in retirement and other deferred compensation last year, for a total of $265,202. Rivers subsequently attributed his departure to an addiction to prescription painkillers and maybe there was a contract or something that KLOVE couldn't get out of. Who knows. All told, KLOVE listed 14 people earning a minimum of $114,000 or more last year on its IRS forms. Not bad for Christian non-profit work.

Don't be fooled. "Christian ministry" often seems to be simply big business operating as a "non-profit." Sure there's plenty of good hearts out there at KLOVE with a desire to serve Jesus Christ and play Christian music and the like. But when and where does "Christian ministry" blur the line between personal gain? I think whether you are a pastor at a church, a CEO of a Christian "non-profit" organization, a missionary, or in whatever capacity you believe the Lord is calling you and leading you and directing you, when it comes to money the question always boils down to whether or not the Lord gives you a peace about your paycheck. Is there any check at all on your heart? When you read the Bible every morning (hopefully you're reading the Bible ...) are you paying attention to what is being said about money? How do you justify these paychecks? The Apostle Paul had something to say about this: "For the love of money is a root of all kinds of evil, for which some have strayed from the faith in their greediness, and pierced themselves through with many sorrows." (1 Tim. 6:10 NKJV) Jesus, the ultimate authority, weighed in on this: "Do not lay up for yourselves treasures on earth, where moth and rust destroy and where thieves break in and steal; but lay up for yourselves treasures in heaven, where neither moth nor rust destroys and where thieves do not break in and steal. For where your treasure is, there your heart will be also." (Matthew 6:19-21 NKJV)

15 comments:

WOW, thx for this info, I called Klove today @ getting sick n tired of their marketing ploys laced with guilt trips and they did not deny (I have a marketing background) the push pull marketing, east coast hard hitter and nearly in tears get their hearts. this is a well planned marketing strategy that employs every marketing facet outside of sex. ie repetition - hit em every few minutes. walk them to the phone stepxstep, much harder hitting marketing than 15 yrs ago when I donated $40 a month for a year and I only made $11p/hr to support a family of 4. 2 yrs ago when I called the Klove line to talk to a Pastor about my daughters issues, no return call. They assured me on the phone today, when I brought all this up, that the pastors return each n every call - NOT! I told her I don't trust their word based on that... and want to know their salaries, as I would not contribute donations to folks making more than me - she agreed. most of what she said was cold hearted canned responses not sincere. I also suggested they use actual Christian Business for commercials for a WIN-WIN-WIN so Christian Businesses can advertise honestly, and consumers and listeners know where to find Christian Businesses. I know why they don't - they would not make as much profit as they do with donations. This is criminal, corruption, greed and should be exposed. I make $42,500 a year, which I'm grateful for, and I'm not about to fund 14 folks making $114K and Mr. Novak. I'm appalled! U called it on Matthew 6:19-21!

No problems with Mike making what he makes. I'm sure none of the folks commenting could run KLOVE and probably have not checked the compensation for the American Cancer Society $800k +, Girl Scouts $800k +, United Way $1 mil, UNCF $700k +, Boys Scouts $900k +, City of Hope $1.4 mil + and many more. Maybe Jessica, Genie and Matt can run one of these organizations? Or better yet I guess you'd be happier if these organizations didn't exist. That would be a shame as they help millions and millions of people each year. Oh yeah don't forget about your local lottery that takes in hundreds of millions each year of "common" folk money. All I know is that these folks are doing "SOMETHING" (more than most) and making a difference in millions of lives. Good organizations doing great things.

I think that a more helpful measure is what percentage of income goes to compensation? Michael Novak makes an uncommonly high amount given the overall expenses of his organization.

Let's take the American Cancer Society, which you mentioned. Their CEO makes around $800,000 on over %800,000,000 in operational expenses. .10% is a pretty typical non-profit salary. It holds true for NPR (an more complex radio broadcasting organization) and many of the ones you mentioned.

By contrast, Novak's salary is over $500,000 on operational expenses of 91,000,000, which is almost .6% of expenses. That's very high and doubly ponderous in a Christian organization.

$500.000 a year. Wow you could store up a lot of treasures in this world. But that wouldn't get you in to heaven. It is easier for an elephant to thread through the eye of a needle, than for a rich man to get in to heaven. So keep telling yourself that $500.000 a year is justified for what he does. I think he could learn a thing or two about king Solomon.

My husband is donating $125 s month and his only making $1,900 a month that's why wvery month we always have a fight about this , I said to him it's too big because we are living paycheck to paycheck .! Now , I'm the bad guy ! I'd rather help the needy person directly than giving my credit card number to donate like my husband did! He is helping Mike Novak to become a billionaire !

I realize this post is old and so I have no idea who will see my comment, but I read this post earlier today and so many thoughts have run through my head to the point where I have to respond. 1) I think it's perfectly fine for us to know the incomes and financial doings of entities such as KLOVE. But I kind of feel it stops there. We do not work for that company for a reason. It is not our responsibility to handle anything at KLOVE. The only thing we are responsible for is praying how God wants us to use OUR hard earned money and pray for the ministry as a whole. 2) Yes, Mike Novak makes a ton of money, but who are we to say how much? We have no idea the depth of his job. It may involve 7 days a week or late nights or much time away from family. After all, he is in charge of a NATIONAL ministry!! He is one person in a group of people who have the amazing opportunity to bring thousands of people to Christ! We should be praising God that KLOVE exists and are doing everything they can to further the kingdom of God. 3) While we can all agree that Mike and maybe others at KLOVE make a lot of money, how dare we question that? For all we know, he and his family may donate $100,000 a year to run orphanages in Africa. He may live in a $150,000 ranch home he bought 20 yrs ago. He may be tithing 10% to his church. He may personally donate to 10 different local charities in his hometown or 10 different organizations around the world who help minister to the lost or provide resources to those in need. I could go on and on, but my point is, a lot of the money he is earning could be going right back into the kingdom of God because God has blessed him with much and he accepts that blessing humbly and with the understanding of the impact he can make. We do not know, but we can pray that he is open to God's direction. 4) We must remember that the people at KLOVE are human beings, imperfect and sinful, just like us. They make mistakes just like us. Until I have concrete evidence that KLOVE is hugely mishandeling the money I and many others give each month, I am going to praise God that I even have $40 to give each month and thank Him for leading me to give to KLOVE. Most people PRAY and receive CONFIRMATION that they are to give to this ministry. We are not forced to and God will not ask all of us. 5) My husband has 6 years post high school education and still only makes $41,000 as a high school special education teacher. I have my master's and stay home and homeschool our 2 children. Are things easy financially? Most of the time, no. Do I have a case for how "unfair" our scenario is? Sure. But boy what damage that would do!! I get bitter at times (imperfect human being), but I am almost in tears at this moment thinking of HOW MANY BLESSINGS my family has been given by God!! Do we deserve it? Heck no. I try my best to be thankful and grateful for all we have and for all we don't have. We try our best to be good stewards of the money we do have and we must remember, it's not ours anyway! It all belongs to God! 6) God never promised things would be "fair." Especially the kind of fair our selfish human minds think of. He is a GOOD GOD, but we will not all have high paying jobs nor will we be exempt from challenges or pain or hard times. He simply asks us to be RESPONSIBLE for what we do have, what we've been given and to do what He has asked us to do with our time, money, resources, influence, etc. As long as we compare ourselves to who others are and what they have, we will make excuses. Compare yourself to yourself and then progress can be made!! God bless!

Stephanie you are so right! There is nothing else that needs to be said. For all we know Mr. Novak is giving a majority back to K-lov and living very modestly and with great generosity. Only the Lord knows the heart! God bless K-lov!

I have done some work for Mike. He lives quite modestly. You would not think he was rich by looking at his house or possessions. He is not two-faced at all. He was as kind to me at his home as he sounds on the radio. I am not a donor either. I am a nobody.

It's funny, I looked this up with the purpose of finding out how much money he makes. I hope you all know how much more he can make #1, and #2, no one knows how much money he actually donates. I mean, 22 million in revenues, and the guy takes home 500,000. 10% of 22 million is 2.2 million. He is taking 1/4 of that. So of the total revenue the company makes he is taking 2.5%. Hmmmmm I wonder if that is fair or not?

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Ok, I'm saved by grace through the blood of Jesus Christ. I'm really, really young for my age, married to a beautiful bride who seems to yield wee lads & lasses at an extraordinary rate, but who is also really, really young for her age. So you see we have a lot in common ... except she has a little bit more hair than me. People are always telling us we should write a book (Have 12 kids and you're supposed to get a book deal, I guess. Or a TV show.), but I think this might be as close as we'll get. My wife Julie and I have 7 boys and 5 girls (hence the whole 12 kids thing): Brenton, 21; Taylor, 18; Ethan, 17; Claire, 15; Evie, 13; MerriGrace, 12; Abram, 10; Madeline, 9; Gabe, 7; Eli, 6; Ezra, 4, Olivia, 2.